BOJ Interest Rate Hikes: Nomura Sees Three Consecutive Increases

Nomura Securities Co. has suggested that the Bank of Japan (BOJ) could raise interest rates three times by December if yen weakness persists.

The BOJ could raise interest rates at consecutive meetings through December in an extreme scenario where yen weakness continues, according to Nomura's head of FX strategy Japan Yujiro Goto.

A quarter-point increase this month 'looks reasonable,' and 'it's possible that we can have back-to-back rate hikes in October and December if the momentum of yen weakness continues toward 160,' Goto said.

The yen has rallied more than 2% this week to around 156 per dollar amid growing expectations for faster tightening, as well as speculation over a potential change in the Government Pension Investment Fund's asset allocation.